The United States Remains Bolivia's 4th Largest Trading

UNCLAS LA PAZ 000057

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ETRD ECON EINT PREL BL
SUBJECT: The United States Remains Bolivia's 4th Largest Trading
Partner


1. SUMMARY. U.S.-Bolivian bilateral trade remains relatively
strong, in spite of cancellation of Andean Trade Promotion and Drug
Eradication Act (ATPDEA) preferences for Bolivia. Overall,
preliminary 2009 numbers indicate that Bolivian exports to the
United States decreased by 14.5% from 2008, compared to a drop of
23.3% overall, with all countries. Data collected for January to
October of 2009 showed that Bolivian exports to the United States
through the Generalized System of Preferences (GSP) program totaled
$92.9 million, a 144% increase over the same period in 2008. This
is due to the shift of trade from the ATPDEA to the GSP program.
Still, many Bolivians -- especially those unable to take advantage
of GSP -- remain keen to recover Bolivian participation in APTDEA.
END SUMMARY.


2. Bolivia's trade with the United States declined in 2009, but
the United States remained Bolivia's fourth largest export market.
The most significant exports were precious stones ($97.9 million),
tin ($86.9 million),silver ($59.3 million),and fuels ($47.5
million). Bolivia lost ATPDEA benefits on December 15, 2008. In
2008, U.S. imports under ATPDEA from Bolivia totaled $128,905,636.
This represents approximately one-fifth of bilateral trade between
the countries that year. ATPDEA sectors hardest hit by the loss of
trade benefits were mineral fuels and oils (- 51%) and knitted
apparel (-43%). Also impacted were leather goods, cotton apparel,
and footwear. The national Exporters Association reported that in
2009 textile exports dropped by $19.5 million. Similarly, the sale
of leather goods dropped by $12.3 million.


3. Many goods previously exported under ATPDEA appear to have
transitioned to the GSP program. Through October 2009, Bolivian
exports to the United States through the GSP program totaled $92.9
million, a 144% increase over the same period in 2008. This
represents 24% of the $390.2 million dollars exported from Bolivia
to the United States through October. Of the $390.2 million in
Bolivian exports to the United States more than $193 million
entered the United States without paying any tariff. Products that
benefited from GSP included jewelry, wooden furniture, hearts of
palm, onions, leather goods (except shoes),some textiles, and
food.


4. In 2009 Bolivia imported $4.4 billion worth of goods from
around the world. The United States supplied 13% of this total.
Top Bolivian imported products were machinery and mechanical
appliances ($179.5 million),vehicles ($109.1 million),and mineral
fuels and oils ($9.0 million). In these markets, the U.S. supplies
26.8%, 20.1%, and 1.9% respectively. Other top Bolivia imports
were steel ($269 million),of which the U.S. supplied less than one
percent; electrical machinery, equipment, and parts ($259 million),
of which the United States supplied 16%; and plastics and plastic
products ($211 million),of which the United States supplied only
5%.


5. Comment: Throughout 2009, many Bolivian exports effectively
transitioned from the ATPDEA to the GSP program. Still, there
continues to be strong interest in the business community in
expanding exports to the United States under GSP and advancing
discussions of recovering preferences for the U.S. market for
textiles and other products not covered under GSP. Indeed,
numerous contacts throughout country indicate that this is the
number one issue for business interests throughout Bolivia. There
also appear to be significant opportunities for the United States
to expand its exports to Bolivia in specific sectors such as
machinery, vehicles, and plastic products.
Creamer